New iPhone supply chain contains labour abuses, claim campaigners

A Chinese supplier said to be making the new model of iPhone has been accused of labour abuses.

In a report China Labour Watch (CLW) claimed the Taiwanese company Pegatron, a major Apple supplier, was undercutting the minimum wage, forcing employees into excessive and illegal overtime and not providing adequate safety equipment.

CLW said declining profits at Apple have had a knock-on effect on its suppliers and Pegatron exploited workers to “mitigate the impact”.

The allegations surround a plant in Shanghai employing around 60,000 workers. CLW said the plant is currently involved in the manufacture of the anticipated new iPhone 7.

In its report, based on interviews with Pegatron employees and a study of payslips, CLW claims wages have dropped significantly in the last eight months, despite the Shanghai Municipal Government recently raising the minimum wage.

The labour rights group also said it found evidence of excessive and forced overtime, with one employee clocking up 109 hours of overtime in one month.

CLW also found evidence of employees being regularly required to do 10 minutes of unpaid work before clocking into each shift, something they had to do after every break and meal, while long security checks ate into employee’s rest time.

This is not the first time Apple has been accused of having labour abuses in its supply chain, and the company has been taking steps to increase supplier auditing and transparency. Apple said it limits workers to no more than 60 hours a week with a compulsory day of rest across its supply chain, and said it achieved 97% compliance in 2015.

However, CLW said Pegatron has made “every effort” to prevent independent scrutiny of its employment practices and is “increasingly opaque”.

A spokesman for Pegatron said: “We work hard to make sure every Pegatron facility provides a healthy work environment and allegations suggesting otherwise are simply not true… We have taken effective measures including electronic record monitoring as well as a badge and turnstile system to ensure employees do not work more than 60 hours per week and 6 days per week.”

The spokesman also said, contrary to CLW’s claims, Pegatron’s base wage is higher than the minimum wage and employees take on average just four minutes to clear security. “We take all allegations seriously, and we will take all necessary actions if any deficiencies are found at our facilities.”